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Pocket Option is one of the most renowned trading platforms that offer a wide range of tools and indicators that helps traders in making informed trading decisions. One such tool that is really popular among traders is the Rate of Indicator indicator. This tool is very powerful and can help you make informed decisions regarding upcoming trends and reversals. In this blog, I will cover everything about the Rate of Indicator and how you can use this indicator effectively on Pocket Option.
What is the Rate of change Indicator?
The Rate of change Indicator or you can call it ROC is a momentum-based indicator that measures the percentage change in price over a specific period. This indicator helps traders to identify upcoming trends and reversals by measuring the strength and velocity at which the price changes. This indicator compares the previous price with the current price and traders can use this information to assess market momentum and spot high-quality buy and sell signals.
Rate of change= [ (Current Price – Price n period ago) / Price n period ago] *100
Here, Price n period means the closing price n period ago.
How to add the Rate of Change Indicator on the Pocket Option?
In order to add the Rate of Change Indicator on the Pocket Option chart follow the step given below
Step 2: Choose the desired currency you want to trade on just click on the currency tab.
Step 3: Click on the indicator button and select the Rate of Change Indicator from the list.
Step 4: Lastly, make the necessary amendments as per your needs and once you are done click apply.
Unboxing Rate of Change Indicator on the Pocket Option
The Rate of Indicator is made from a single moving average line. When you open the indicator you will see the default period of the indicator is 14. The period of the indicator helps to smooth out the indicator movement reducing the indicator period will result in a faster reaction of the indicator in accordance with the price while increasing the indicator period will result in a slower response of the indicator in accordance with the price.
How to find signals using the Rate of Change Indicator on the Pocket Option
Finding high-quality trading signals with the Rate of change indicator is very easy. When the moving average line intersects the zero line from the bottom and stays in an uptrend for a while it signals the best opportunity to place a buy trade and vice versa, when the moving average intersects the zero line from the top and stays in a downtrend below zero line for a while it signals the best opportunity to place a sell trade.
Confirm Trend with Schaff Trend Cycle Indicator
Schaff Trend Cycle Indicator is a very popular trend indicator and can work very well with the Rate of Change Indicator. When both indicators are in a rising position after coming from the bottom it signals a strong bullish trend and vice versa, When both indicators are in a downtrend position after coming from the top it signals a strong bearish trend.